Book Review: The Difference by Jean Chatzky

If you are looking for motivational personal finances, Jean Chatzky’s recent book, The Difference provides just that. Chatzky is a well-known financial journalist who offers helpful insights into what you need to do in order to change your financial situation. Her book previous to The Difference was Make Money, Not Excuses — and a bestseller. In Chatzky’s latest offering, she looks at what makes the financially comfortable and the wealthy tick, and describes what you can do to benefit from what she refers to as The Difference. Even during times of economic uncertainty.

The Difference focuses on the finding from the 2008 Merrill Lynch New Retirement Study, which looked at a number of behaviors and attitudes amongst people with varying degrees of wealth. These four degrees of wealth are classified as Wealthy, Financially Comfortable, Paycheck to Paycheck and Further in Debtors. Chatzky explains that there are some fundamentally differences in the ways these four groups think and behave with regard to financial practices, goals, personality and other nonfinancial behaviors. If you want to be wealthy (or at least financially comfortable), you need to analyze what those groups have, and then try to develop those characteristics.

Chatzky uses anecdotes from interviews to illustrate the characteristics of some “ordinary” wealthy people. She also includes helpful sections on bad financial habits, common mistakes and tips for improving your situation. And she uses motivational language throughout, encouraging you to feel empowered in a way that allows you to take charge of your financial life. There are also a number of quizzes that can help you determine where you are at in terms of developing the qualities that define The Difference between those that are in a good place, and those that still need work.

Overall, the book is a fairly easy read. I found it more interesting than I did directly practicable. I’m more of an analytic numbers person, and I like being able to develop a plan. Understanding the psychology of the wealthy doesn’t really translate into direct action for me, even though the charts and images that showed comparisons between the four degrees of financial security offered some fascinating insight into the mind-sets of these groups. But for those with more motivational sensibilities, this book is probably right on the money. And, ultimately, that is what this book is about: Changing your mind-set so that you can begin to develop the qualities that can ultimately lead you wealth.

Have you read The Difference? Did you like it?